20/03/2012 Daily Politics


20/03/2012

Andrew Neil and Jo Coburn with the latest political news and interviews, including debates on the Budget and on coalition deals.


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Transcript


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Afternoon folks, and welcome to the Daily Politics. There's more

:00:40.:00:48.

fevered speculation over the contents of George Osborne's budget.

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The Daily Politics understands we can expect a change in the 50p rate

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of tax and plans to raise the tax free allowance to �10,000 earlier

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than first promised. We'll bring you all the details.

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The top team in both the Liberal Democrats and the Conservatives all

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seem happy with the Budget, but what do their MPs think? We'll get

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the thoughts of two backbenchers. Both the Chancellor and Shadow

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Chancellor had lots to talk about this morning as they waited for the

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Queen's Address to Parliament. We'll bring you highlights of the

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speech. And the NHS bill could finally clear all it's

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parliamentary stages this evening, but what actual difference will the

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bill make to patients? We'll speak to a health minister. All that in

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the next hour, and joining us for the first part of the programme, we

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have two wise men. I'm afraid BBC cutbacks meant we couldn't afford

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three. The former Scottish Secretary Michel Forsyth and former

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employment minister Jim Knight, welcome to the show. Earlier today,

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as part of her Diamond Jubilee celebrations, the Queen addressed

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both Houses of Parliament. To mark the occasion, the Queen was

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presented with a specially- commissioned stained glass window,

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donated by members of both Houses. Here are some highlights of the

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:02:13.:02:13.

Apology for the loss of subtitles for 44 seconds

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You have become too many of us a kaleidoscope Queen of a

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:03:07.:03:08.

kaleidoscope country in a Since my accession I have been a

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regular visitor to the Palace of Westminster, and that the last

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count have had the pleasurable duty of treating with 12 prime ministers.

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During these years as your Queen, the support of my family has,

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across the generations, been at beyond measure. Prince Philip is, I

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believe, well known for declining Compliments of any kind. But

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:03:51.:03:57.

throughout he has been a constant And the highlights from this

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morning, a very grand occasion. Michael Forsyth, they understand

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you were there. Describe the atmosphere. We have seen the

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pictures of Westminster Hall, the oldest part of the Palace of

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Westminster and it did look amazing. I sat there thinking this is the

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same place that Queens were tried, and you have a sense of history,

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and then the Queen arrives and addresses were given by the Lords

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and Commons, but in her address she made some very pertinent points in

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a subtle way about the importance of continuity. It was the best

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argument I could think of for not having the presidency. It brought

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everyone together. No one was sure when to end the applause. We wanted

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to keep applauding but we were interrupted by the Speaker

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presenting a petition. It was interesting to see all former prime

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ministers, she mentioned that she has presided over 12, familiar old

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faces there as well. Nice to see some of the old faces. These are

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occasions that we do well in this country. The Queen is certainly a

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class act and has it really well. That sits well with how well we do

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big state occasions, and the jamboree and pomp and ceremony.

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sign of her retiring any time soon. She said she would read dedicate

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herself to the service of the great country and its people and in the

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years to come, she is 86. That was the best bit of the speech. An

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affirmation of the importance of monarchy as an institution which

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continues. There is no question of her abdicating at any stage. I

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think that is essential to the whole nature of the office. There

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is a lot to be said for having an apolitical head of state. She does

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that really well. I think the nation is very happy if she wants

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to carry on and will be delighted with the message she gave today.

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And a special tribute to Prince Philip who has not been well over

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the last few months, but interesting to hear her make

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special reference to him at a personal level. In some ways we

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have an affection for Prince Philip, for all of his gaffes for as much

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as his good behaviour, but she values him as a lifelong partner

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and pays tribute to the support he gives her, and quite right she

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should do so. What was he on about, the kaleidoscope Queen and the

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kaleidoscope country, a kaleidoscope Commonwealth? What was

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that about? I have no idea. But when the Queen said we have had

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many changes over the is the one thing has remained the same, the a

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foul of the arms services, she was underlining the importance of

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continuity as well as change -- the about service of the armed forces.

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So what did it actually mean? The Lords and the Commons have no idea

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Well, in just over 24 hours' time, George Osborne will emerge from

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Number 11 Downing Street with his red box to deliver his third Budget,

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although you have to wonder whether he needs to as most of what's going

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to be in it has already been leaked. One journalist asked the Prime

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Minister if there was anything but hadn't been leaked in the Budget,

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and he just smiled. There will be new measures on tax and spending on

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the margins, but there budget will be fiscally neutral, in other words

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they will be no overall boost to the economy. But then maybe things

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are looking up a little bit anyway? Behind the door at Number 11 there

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have probably been a couple of late nights as the Chancellor and his

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aides put the final touches to the Budget. But what is the broader

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economic picture? This morning we've had some good news on

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inflation, which fell from 3.6% in January to 3.4% in February. There

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might also be some good news on growth tomorrow. In the autumn

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statement last November, the OBR forecast that growth this year

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would be 0.7%. According to the Financial Times that figure will be

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revised slightly upwards to 0.8%. The slight upturn in growth means

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there could also be some better news on borrowing. In November,

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borrowing was expected to be around �127 billion for this financial

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year. But some reports suggest it could be more like �120 billion.

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The slight improvement in the economic landscape gives the

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Chancellor a bit more wriggle room. With that in mind, the Daily

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Politics understands tomorrow's Budget will be dominated by two

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major announcements. Firstly, the tax-free allowance before income

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tax kicks in will be increased more quickly than the Coalition

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agreement currently envisages, reaching �10,000 in April 2014, a

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:08:45.:08:46.

Secondly, the top rate of income tax will be cut from 50p to 45p,

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but not until April 2013. Joining me now is Simon Hayes, chief UK

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economist at Barclays Capital. Give us your reaction to the inflation

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figures first of all. The inflation figures were mildly encouraging but

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the fact is the fall in inflation was less than we expected to say,

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and this is a concern that we have for the rest of the year. It is

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important inflation falls as households were squeezed last year

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and there was a week pay growth which accounts for the weakness in

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the economy we saw last year but there are things like higher oil

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prices and higher commodity prices meaning inflation might not fall as

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fast and as much as we hoped this year. So you do not think it will

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reach the target being put forward for the end of the year to, much

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further down? If the Bank of England expects it to fall below

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the 2% target by the end of the year and we expect it will fall

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closer to the target but remain above that level of 2%. That should

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provide some support for households as there is less of a squeeze but

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the boost will not be as strong as some forecasters expected. What

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about borrowing? The indication is that the Chancellor's figures might

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be slightly better and the mind after borrow quite as much. No one

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wants to talk about green shoots, but does it indicate a slight

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upturn? Fighting the way to characterise it is that the

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situation doesn't look as bad -- I think the way to characterise it.

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Last November in the last three months of last year the economy

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actually contracted. The early indications are in the first

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quarter of the year we will see some return to growth although the

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euro area is in recession, so there are difficulties ahead. The bad

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news we were factoring into forecasts at the end of last year

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maybe isn't quite so bad, as it stands now. Simon Hayes, thank you.

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Let's see what our guests make of the current economic situation.

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Whether the OBR thinks growth will be 0.7 or 0.8% is neither here nor

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there. The Financial Times's splash on that I thought was April Fool's

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Day. The idea that anybody knows by one percentage point, a 10th of a

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percentage point is irrelevant. Growth will be in Munich and

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inflation is still high at 3.5% and unemployment is forecast to stay at

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2.7 million. It is still grim. agree. The fundamental problem is

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that the government is spending too much, about half of what the entire

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Earl of -- country produces. While it continues at that level it is

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hard to see how good levels of growth can be obtained, because

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growth is created by small and medium-sized businesses selling

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goods and services competitively. If there is a huge tax burden upon

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them and regulation it is hard for them to do so. That there is no

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great change in the Government's strategy, as it won't cut tax.

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Every cut will be balanced by a tax increase or a spending cut, so it

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is fiscally neutral. Even in the tax changes it makes it is not

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planning any transformational tax changes that would give a new lease

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of life to the businesses you speak of. I agree with you. When we were

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in opposition and I did the tax commission for George, his manager

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was a lower, fairer, flatter taxes and stability. -- is mantra. I do

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not know if they're going to do anything about pension relief.

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understanding is not. Well, that is a big step forward, because it is

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important to have stability in an area like long-term saving and

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pensions. But is it fair that at a time when we are all in this

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together that the vast bulk of pension tax relief should go to

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those on higher incomes? What we want to do is encourage people to

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save and encourage investment. can still save �50,000 a year.

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face-saver less there will be less money available for investment and

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less money all round. That if you can put �50,000 in your pension pot,

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if you can afford it, but the wealthy can and deducted. You can

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get tax relief but only at the basic rate. The problem is his if

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government keep changing the rules. Gordon Brown started it with the

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tax on dividend income as for pension funds. If they keep

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changing the rules people will not pass to be -- will not have faith

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in what has to be a long-term stable environment and they will

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not put money into pensions which is bad for investment. The Labour

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critique is obviously different. It is cutting too fast and too deep,

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we have heard that many times, and on the face of it should be popular

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because you are trying to spread the pain out over more time, but

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some Labour columnists say that more than one senior figure is said

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to have met Ed Miliband privately to air concerns about Labour's

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dwindling credibility on the economy. Why's that? We have to

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continue to focus on the problem of jobs and growth. Two years ago when

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George Osborne went into Number 11 we had growth returning to the

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economy and unemployment was coming down, and his policy failed. Yes,

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there are areas where we need to cut spending, but the principal

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problem is a lack of income coming into the Treasury, Prince of lust

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and the City and we need to grow that again. -- principally lost

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from the city. We need to see growth from small and medium-sized

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businesses but with the Merlin initiative to lend more money to

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small and medium-size enterprises has not worked. Hold on, it met the

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targets. It was only 1 billion less for small businesses. He let it hit

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74 billion rather than 74 billion - - and the 5 billion, and if the

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government hit those targets, we would be away at the races.

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would be, but they are failing every step of the way. George's

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policies are not delivering the growth and the growth he needs in

:15:07.:15:10.

terms of revenue coming into the Exchequer to reduce the deficit.

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Over the five-year cycle, his borrowing will be about �120

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billion more than the predicted. For the problem of the critique is

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that when it comes to spending but -- cuts, the massive cuts made so

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far are affecting the economy are actually almost no different from

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the size of the cuts that Alastair Darling proposed. So it could be

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that the early growth you had was really a dead cat bounce, as many

:15:38.:15:46.

economies came out of that they all I believe we need some short-term

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stimulus, that is what we did in 2009, 10 to get the economy growing

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again, to get people off benefit into work, paying taxes rather than

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receiving benefits. That is good for redice -- reducing the deficit.

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Over the medium to long-term we reduce the overall spendling

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figures so we can get into balance over that period. The Liberal

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Democrat, if the Daily Politics the right and we will move to the

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10,000 threshold before you pay tax by 2014. My understanding is what

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is already in the pipeline will stay for this year, and for 2013

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own the current target they wouldn't hit it until 2015 so they

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will double up at 2014. I know the Liberal Democrat also dine out on

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that and say we did that, we did that, but your report on tax, it

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recommend the same thing, so how come your party is -- party is

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allowing the Liberal Democrats to get the credit. I don't know. To be

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fair, our report also said that it was important to cut the marginal

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rates of tax because that has a more dynamic effect. That is

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difficult to sell. One option top story the Chancellor would be to

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raise the thresholds on the top rate of tax which I would favour.

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What are you calling the top rate of tax. The 50 pence. When your

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report came out it was 40 pence. was. You wanted to cut that. Indeed.

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Shows you how times have changed. When George became Shadow

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Chancellor he was in a favour of a fat tax. That is when he was

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talking about sharing the proceeds of growth. I thought that is great,

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everybody can pay 20 percent. I don't think that is what they meant.

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Labour has a problem here, it is a, given the mess Gordon Brown made of

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the 10% band, denying that there was any impact on poorer people,

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when the rest of his party including backbenchers said it was,

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taking people out of tax is a popular thing to do. It is, but,

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the lessen from Gordon's mistake is you have to be careful about

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announcing thins in a hurry and think you will get away with it T

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Government is seeing with the work tax credit change, this April f you

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are earning less than �17,500 a year and working you will lose �70

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a week. I understand that. But that wasn't what, it is an important

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point, not the point I asked about. My point was it is going to be

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difficult for Labour to oppose going to a situation where the

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first 10,000 of your income isn't taxed. Of course. We have to make

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sure that it pays people to get into work, and the lowest earners

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gain the most. That is why we think there are fairness issues attached

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to cutting the top issue of tax. Even if it meant there was nor

:18:43.:18:47.

revenue and you could do more. think the jury is out on that one,

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we will have to wait. Before we move on, can we agree, although the

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headline impact if we when you take, increase the threshold when you

:18:57.:19:03.

start paying tax is to take a lot of very low wage earners out of tax

:19:03.:19:07.

all together, the vast bull of course the billions this cause go

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to middle income earners. It is not a secret but maybe a hidden tax cut

:19:12.:19:16.

for middle income. That is why I prefer the tax credit subpoena, we

:19:16.:19:20.

will be replaced by the use versele credit. I support what the

:19:20.:19:25.

Government is doing on that, but they have to be careful how they

:19:25.:19:29.

introduce it. Maybe a Liberal Democrat conspiracy to get tax cuts

:19:29.:19:33.

to the middle because that is who vote for them. I think that I think

:19:33.:19:36.

the leader of the opposition was right when he talked about the

:19:36.:19:40.

squeezed middle. People are finding it hard, if they are not within the

:19:40.:19:43.

benefit system, and they are subject to pressure. I mean the

:19:43.:19:46.

fundamental problem is that Government is spending too much,

:19:46.:19:49.

and borrowing too much. There is only one way to deal with that, and

:19:49.:19:53.

that is to reduce the amount that Government takes. It is not growing

:19:53.:19:58.

enough either. That is because the Government is spending too much.

:19:58.:20:03.

There is a circular here. Let us leave that as an unbroken circular.

:20:03.:20:08.

We will let these hang on the table and people can make up their own

:20:08.:20:11.

minds. If you are the Chancellor, keeping your own MPs happy with

:20:11.:20:15.

your budget plans is hard enough, but having to keep someone else's

:20:15.:20:20.

happy is an almost impossible task, there have been reports of tense

:20:20.:20:23.

meetings between the Quad of Nick Clegg and Danny Alexander and David

:20:23.:20:27.

Cameron and George Osborne on the other. As the two side try to

:20:27.:20:31.

thrash out a deal. While the party hierarchies might be satisfys what

:20:31.:20:35.

about the backbenchers ch joins me is John Pugh from the Liberal

:20:35.:20:37.

Democrats and Matthew Hancock from the Conservatives. Welcome to both

:20:37.:20:43.

of you. John Pugh, can I start with you, how will you and your

:20:43.:20:47.

colleagues feel if the 50 pence top rate of tax is scrapped, without

:20:47.:20:52.

meeting your party's key demand for a mansion tax? We lock at the

:20:52.:20:55.

budget in the round and we will consider what the overall effect is.

:20:55.:21:01.

If the broader shoulders bear the most, we can reconcile ourself to

:21:01.:21:04.

any individual detail in the budget. There is a drive on our part to

:21:04.:21:08.

make sure the rich pay more, and hopefully that will be fulfiled by

:21:08.:21:12.

the budget. Would you like to see a mansion tax on the well hi thi in

:21:12.:21:15.

return for the scrapping of that top rate of tax? There are

:21:15.:21:19.

difficulttys with the mansion tax, one advantage is the rich can't

:21:19.:21:24.

hide their mansions, Lord Oakeshott said trying to tax the rich is like

:21:24.:21:28.

trying to nail jelly to a wall. The one thing they can't disstkpwies

:21:28.:21:32.

where they live and the man sthains live in. Taxing that is an idea one

:21:32.:21:39.

has to look at. I would be prepared to consider a tycoon tax. It don't

:21:39.:21:43.

look as if mansion tax is going to happen. So a promise to clampdown

:21:43.:21:46.

as every politician promises to do on tax avoidance, is that enough to

:21:46.:21:52.

get the superrich to pay their fair share? I don't think we can accept

:21:52.:21:56.

hard wired changes in the budget that make life easier for the rich

:21:56.:22:01.

and some promise we will clampdown on tax avoidance as a counter

:22:01.:22:05.

balance to that. We look for centre measures to make sure that people

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pay their proper level of taxation. A cut for the biggest earners will

:22:10.:22:14.

send a message we are not all in this together? Let us see what is

:22:14.:22:19.

in the budget. Very much agree with what John said, in terms of taking

:22:20.:22:23.

the budget in the round, and it being, no, and this is an important

:22:23.:22:28.

point, and it being a budget for working families there is very

:22:28.:22:32.

strong Conservative support for raising the tax threshold, that is

:22:32.:22:35.

something Conservatives tat last election campaigned for, Liberal

:22:35.:22:39.

Democrats campaigned for it too, and it is something that so far has

:22:39.:22:43.

started to be delivered, so this is something where actually it, I

:22:43.:22:47.

think it is the Government acting together and dare I say it in the

:22:47.:22:52.

national interest, rather than looking at... The Liberal Democrats

:22:52.:22:55.

are very much claim this as a Liberal Democrat initiative they

:22:55.:22:58.

have had to almost put upon whether it is true or not on to George

:22:58.:23:02.

Osborne, so you don't agree that it is a Liberal Democrat initiative,

:23:02.:23:07.

this raising the threshold? it's a Government policy at the end

:23:07.:23:12.

of this Parliament, when the... will be judged on Government

:23:12.:23:15.

policies. We will be judged on the coalition gith Government and you

:23:15.:23:18.

will have whatever is announced tomorrow, you will have a

:23:18.:23:21.

Conservative Chancellor announcing it. It is not like the

:23:22.:23:24.

Conservatives can distance themselvess from a huge and

:23:24.:23:28.

positive and beneficial policy like taking millions of people out of

:23:28.:23:34.

tax. So it is huge and beneficial, hugely beneficial, but the

:23:34.:23:38.

Institute for Fiscal Studies say if it is raised to 10,000 by 2014, the

:23:38.:23:43.

point at which you start paying tax, will it cost the Exchequer �6.5

:23:43.:23:47.

billion a year, now changes to date they say have cost �5 billion a

:23:47.:23:57.
:23:57.:23:57.

year, is that the best use of all that money? Certainly making sure

:23:57.:24:03.

work pays, and especially reducing very strongly the marginal rates of

:24:03.:24:08.

those earning sx, seven, 8,000 a years mostly part-time worker, the

:24:08.:24:12.

majority women, improving the, how much you take home from that is a

:24:12.:24:16.

big step forward economically, as well as money in people's pockets.

:24:16.:24:20.

John Pugh, doesn't it help people further up the income scale more

:24:20.:24:23.

than it does those people at the bottom end, and of course it is not

:24:23.:24:28.

as progressive as for example you might argue tax credits? I think

:24:28.:24:31.

tax credits were overblown in the sense they went to people who I

:24:31.:24:35.

think shouldn't have been getting them in the first place. This

:24:35.:24:42.

measure is not perfect. No measure is perfect. What we can be assured

:24:42.:24:47.

of is it will be good for the economy. You do admit it helps

:24:47.:24:53.

people further up the income scale more. That is self evident.

:24:53.:24:57.

Although raising the tax threshold as oppose to a cut in the basic

:24:57.:25:01.

rate gives the same amount of benefit to everybody, which is the

:25:01.:25:04.

proportion of your income is bigger the further down the income scale

:25:04.:25:09.

you are, so, you know it is the people who are taken out of tax all

:25:09.:25:15.

together that as a proportion of their take home pay get the biggest

:25:15.:25:22.

advantage. Do you agree the policy on child benefit is anti-family and

:25:22.:25:26.

anti-success? The anomaly has to be dealt with and the Prime Minister

:25:26.:25:31.

is, has said that, you know, a number of times, but, I do think

:25:31.:25:35.

that it is important that people earning small amounts, and on low

:25:36.:25:40.

incomes, aren't paying tax, to give benefits to the very well-off. I

:25:40.:25:44.

think that is an important principle, in terms of child

:25:44.:25:49.

benefit, and it is one that obviously has to be, you know, the

:25:49.:25:52.

government's promised to deal with, and the question of how you make

:25:52.:25:56.

the policy work we will find out tomorrow. OK. We will indeed. Thank

:25:56.:26:06.
:26:06.:26:07.

you. We are joined now be Dick Newby. Welcome to the Daily

:26:07.:26:11.

Politics. Thanks to the Liberal Democrats, this whole budget

:26:11.:26:16.

process has leaked like a colander, great for journalist, not sure the

:26:16.:26:22.

Treasury Shapy, but has it worked as a strategy to get you away?

:26:22.:26:26.

Budgets have leaked over recent years I seem to remember Gordon

:26:26.:26:31.

Brown was a dab hand at leaking. wouldn't even tell the Prime

:26:31.:26:37.

Minister what was in the budget. told the Sunday Times very often I

:26:37.:26:41.

seem to remember. You may come to regret saying that. Has the

:26:41.:26:44.

strategy worked? I think in terms of Liberal Democrat priorities for

:26:44.:26:47.

the budget it is obvious the key thing we wanted to do was

:26:48.:26:52.

accelerate the raising of the tax, income tax threshold which looks as

:26:52.:26:55.

if it is going to happen. information is rather than

:26:55.:27:00.

happening, getting to 10,000 by 2015 it looks like he will go and

:27:00.:27:03.

get there now by doubling up in 2014 and he hits it then, a year

:27:03.:27:08.

before the election. Will that satisfy you? That is a very good

:27:08.:27:12.

move, for the reasons you have been discussing. Will you, the Liberal

:27:12.:27:15.

Democrats be taking credit for that? Well, it is a policy that we

:27:15.:27:20.

have been pushing very hard, but we as part of the Government will be

:27:20.:27:23.

taking credit. The Government will take credit because the Government

:27:23.:27:27.

has done it. You won't take credit in the sense if the Liberal

:27:27.:27:30.

Democrats had not been in this coalition this would not have

:27:30.:27:34.

happened. We will say this is one of the things happened partly

:27:34.:27:40.

because we put hard for it. What do you say Michael Forsyth? I saw the

:27:40.:27:43.

lowering of the threshold is important because it helps people

:27:43.:27:47.

who are paying the highest marginal rates, people on low incomes can

:27:47.:27:52.

find 95% of what they earn disappearing. That is the substance

:27:52.:27:56.

for doing it. What I am saying are the Liberal Democrats right to be

:27:56.:28:00.

cake -- taking the credit for this? I think they have supported this

:28:00.:28:07.

policy nce. It is a policy we enunciated in opposition, and they,

:28:07.:28:11.

they have embarked, think irresponsibly in the budget process

:28:11.:28:15.

by making arguments in public, and trying to show they are different.

:28:15.:28:21.

I think their best chance of survival at the next election is by

:28:21.:28:26.

seen to be part of a team. Nothing the Government has done couldn't

:28:26.:28:30.

have been done without the Liberal Democrats. So privatising police

:28:30.:28:34.

forced, the break up of the National Health service all the

:28:34.:28:38.

things they try and deny are the fault of the Liberal Democrats as

:28:38.:28:41.

much as the Tories. Can we stick to the budget, because it is tomorrow

:28:41.:28:45.

and we have done these issues before and we will come back to

:28:45.:28:50.

this before. What, well, hold on irresponsible? I don't think it is

:28:50.:28:53.

irresponsible. I think in a coalition the way you do Government

:28:53.:28:58.

is different in a single party Government. Part of that is having

:28:58.:29:02.

more arguments in the open, between the different parts of the

:29:02.:29:06.

coalition. I think it helps the electorate understand what is going

:29:07.:29:14.

on. Every discussion is leaked to the newspapers, people won't have

:29:14.:29:17.

discussions. I don't think people could say there haven't been Frank

:29:17.:29:22.

discussion. But they have been in public. I follow European politics

:29:22.:29:26.

closely f you look at the coalition Governments in Germany or Sweden,

:29:26.:29:33.

to take two gamles, you don't see, they don't have single budget

:29:33.:29:36.

statements but they have economic policy announcements and all the

:29:36.:29:39.

lobbying, all the argument within the coalition is done behind closed

:29:40.:29:44.

door, it is not done in this public way, which you, the Liberal

:29:44.:29:47.

Democrats have made. Well, I think that, we are getting used to

:29:47.:29:52.

running a coalition, I think that the way that Nick has done it,

:29:52.:29:57.

Vince has talked about other tax policies, is a grown up way of

:29:57.:30:02.

doing it. The old budget procedure in the UK was undually secretive.

:30:02.:30:08.

What do you make, it is changed days from Gordon Brown: I regret

:30:08.:30:10.

the end of collective cabinet responsibility. It is a sign of

:30:10.:30:15.

insecurity from the Liberal Democrats, that they see their

:30:15.:30:18.

popularity dwindling away so they want to be defining their

:30:18.:30:22.

difference from the Tories. So you want to talk about the politics, so

:30:22.:30:27.

let me remind you there are 2.7 million people unployed in this

:30:27.:30:32.

country, under a Conservative led coalition, average wages are rising

:30:32.:30:38.

by 1.5%, prices by over 3.4, higher on those prices ofs we all have to

:30:39.:30:43.

buy, so living standards are being squeezed like mad, there is almost

:30:43.:30:47.

no growth in the economy, and the latest poll shows the Conservatives

:30:47.:30:55.

3% ahead of Labour. What has gone We have had a spate of opinion

:30:55.:30:59.

polls that have put us ahead. George Osborne once told me that he

:30:59.:31:04.

expected by the spring of 2012 to beat 15 up to 20 points behind.

:31:04.:31:10.

What happened? I think the period during the leadership election

:31:10.:31:13.

allowed George Osborne and his conservative friends to land the

:31:13.:31:18.

argument that this was all the legacy of a Labour government, but

:31:18.:31:22.

the reality of course was because of a global financial crisis, in

:31:22.:31:26.

the same way that George says some of his problems are because of the

:31:26.:31:31.

euro crisis. You can't have it both ways. He me he was too stupid to

:31:31.:31:35.

understand the truth. I just Vicky has to accessibly landed the

:31:35.:31:40.

argument and it has stuck in people's mind -- I just think he

:31:40.:31:45.

has successfully landed the argument. When will we see the sun

:31:45.:31:50.

lit up plans that Mr Cameron is talking about? The when the

:31:50.:31:53.

government reduces the tax burden and makes it easier to employ

:31:53.:32:00.

people. So not in your lifetime? live in hope. We are talking about

:32:00.:32:04.

income tax, and no one is begetting an important part of taxation which

:32:04.:32:08.

is National Insurance and the cost of employing people there, you can

:32:08.:32:11.

raise the threshold and take people out of tax but they will still have

:32:11.:32:16.

to pay National Insurance. Would you support a cut in National

:32:16.:32:19.

Insurance to encourage younger people to be taken on by small

:32:19.:32:23.

businesses? I would support a cut in income tax or national insurance

:32:23.:32:27.

because I think the government is spending too much and is creating a

:32:27.:32:32.

sclerosis in the economy. That is one at a five-hour a five-point

:32:32.:32:37.

plan for job growth. Just remind you that the Chancellor in the

:32:37.:32:44.

autumn Budget statement did float the idea of getting rid of the

:32:44.:32:49.

pretence that national insurance is attacked by another way and merging

:32:49.:32:56.

the two together. Would that capture the Lib Dem imagination?

:32:56.:32:59.

sounds a technical thing, but virtually no one understands or

:32:59.:33:09.
:33:09.:33:10.

national insurance is. -- what a National insurances. It is the bit

:33:10.:33:14.

of income tax we are told not to think of as income tax.

:33:14.:33:18.

challenge for all the parties is, if suddenly, what is seen as the

:33:18.:33:22.

headline rate of income tax increases hugely then this is a

:33:22.:33:26.

political challenge to explain it. It is a communications challenge,

:33:26.:33:30.

even though it makes sense in terms of the tax system. It would be a

:33:30.:33:34.

disaster if it was made explicit just how much the government was

:33:34.:33:42.

taking. Is that a good idea, do you think? I can't argue with it. They

:33:42.:33:48.

are being transparent about what government is doing. That is to out

:33:48.:33:57.

of five, almost! -- two out of five. Gentlemen, thank you very much for

:33:57.:34:02.

being with us and we will see what the Chancellor delivers tomorrow.

:34:02.:34:06.

George Osborne is a busy man and would be, and you think the day

:34:06.:34:08.

before the Budget he would be putting the finishing touches to

:34:08.:34:12.

his speech or maybe having a rehearsal. But this morning the

:34:12.:34:15.

Chancellor has been promoting the Government's credit easing scheme.

:34:15.:34:19.

The plans will see �20 billion worth of taxpayers' money to

:34:19.:34:23.

guarantee funding for UK banks, provided the money is lent to small

:34:23.:34:28.

businesses. Here is what Mr Osborne had to say. This is all about the

:34:28.:34:31.

government helping small businesses in Britain to get cheaper loans,

:34:31.:34:36.

helping them to expand and hire more people and create jobs and we

:34:36.:34:40.

are using a good reputation that the government has got in the world

:34:41.:34:44.

by getting control of our debts and passing on the low interest rates

:34:44.:34:47.

we can borrow money at to small businesses around Britain so they

:34:47.:34:53.

can create jobs. Let's get some more details on this with Robert

:34:53.:34:57.

Peston. Robert, is this credit easing scheme going to do what

:34:57.:35:04.

George Osborne would like it to do? It will certainly get marginally

:35:04.:35:10.

cheaper loans out to small businesses. Small businesses who

:35:10.:35:15.

apply for the subsidised loans that will be made available by the Royal

:35:15.:35:21.

Bank of Scotland, Santander, Lloyds, Barclays and some small specialist

:35:21.:35:27.

lenders. They will get loans at about one percentage point lower

:35:27.:35:34.

rate than they would normally have to pay. In the first batch of loans

:35:34.:35:38.

going out, that would represent �50 million worth of subsidies to small

:35:38.:35:43.

businesses, and over the course of the two years where the �20 billion

:35:43.:35:47.

of loans will probably be made available if all goes to plan, that

:35:47.:35:52.

is a �200 million annual subsidy for small businesses. If you are a

:35:52.:35:56.

small business struggling against some difficult economic conditions,

:35:56.:36:00.

getting a subsidy of that sort of scale, that is not trivial. It is

:36:00.:36:07.

quite useful. But will it actually lead to a big stimulus for growth

:36:07.:36:12.

in that sense? It is far too early to make that kind of calculation.

:36:12.:36:16.

I'd be surprised if it was a massive stimulus to growth but it

:36:16.:36:21.

could turn out to be useful. It could be useful in two ways. There

:36:21.:36:26.

are lots of businesses out there who believe that the banks have

:36:26.:36:30.

almost shut up shop when it comes to lending to them and in a sense

:36:30.:36:35.

this is quite allow at first that the banks have got this money and

:36:35.:36:39.

that the government is looking at them to make sure that they provide

:36:39.:36:44.

it. That said, one of the things that many of the critics of the

:36:44.:36:50.

banks would say is that they have become to the risk averse. As you

:36:50.:36:56.

know, in the boom years, up to the great crash of 2007/08, the banks

:36:56.:37:00.

took crazy, reckless risks and now people will say they have gone in

:37:00.:37:04.

the other direction. They are too prudent, not prepared to take

:37:04.:37:09.

enough of a chance on young, growing businesses. But nothing

:37:09.:37:12.

that the Chancellor has announced will encourage the banks to take

:37:12.:37:19.

additional risks. So the kind of businesses that may have lots of

:37:19.:37:23.

potential but are in their early years and have risks, they are not

:37:23.:37:27.

going to get the money and they won't be helped by this. Robert,

:37:27.:37:36.

I am pleased to say joining us for the rest of the shote is the Co of

:37:36.:37:41.

Ariadne capital, and also Mike Cherry from the Federation of Small

:37:41.:37:50.

businesses. We are having taxpayer subsidise loans to small businesses.

:37:50.:37:55.

How will that work. I think it will help certain businesses. It is

:37:55.:37:59.

certainly not going to help access to finance. The government says it

:37:59.:38:05.

will put up 20 billion. It may well be putting up �20 billion but it is

:38:05.:38:09.

only a very, very small amount when you look at the 1% decreasing costs

:38:10.:38:15.

of any loan that the business applies for and succeeds in getting.

:38:15.:38:20.

Is it worth the candle or not worth the candle? It is an initiative to

:38:20.:38:23.

be welcomed at this stage but it is not going to produce tremendous

:38:23.:38:26.

results overnight and we need to be looking at other forms of

:38:26.:38:32.

alternative finance. Such as what? Peer-to-peer lending. What does

:38:32.:38:37.

that mean in English? Business to business lending. There needs to be

:38:37.:38:42.

equity finance for small businesses and all of these need to be better

:38:42.:38:47.

promoted than they are at the mind. A Julie, what do you make of it?

:38:47.:38:52.

There are companies which are peer- to-peer lenders. That is nothing to

:38:52.:38:56.

do with the government. No, but they are good development. The new

:38:56.:39:00.

programme is a signal and it shines a spotlight that this is what the

:39:00.:39:05.

government intends to happen, and whether it is Santander with 200

:39:05.:39:09.

new bank managers or Barclays who say they are loading every minute,

:39:09.:39:14.

who knows whether the statistics are measurable. But the point is it

:39:14.:39:17.

shines a spotlight and says this is a signal that the government

:39:17.:39:21.

intends for small businesses to be backed and it is a national

:39:21.:39:27.

imperative to get the capital up to the companies. Santander is only up

:39:27.:39:33.

for 500 million of this. That is peanuts to them. That is why I

:39:33.:39:37.

mentioned Berkeley's as well. These banks are unable to escape the

:39:37.:39:42.

spotlight that the government is shining -- Barclays Bank. But the

:39:42.:39:46.

government is shining two contradictory spotlight on them.

:39:46.:39:50.

The government and international institutions have been forced far

:39:50.:39:53.

higher capital reserve targets on bank balance sheets. You have to

:39:54.:39:58.

keep a lot more cash and the near cash in the form of low risk assets

:39:58.:40:03.

on your balance sheets. That limits the amount of money that banks can

:40:03.:40:07.

lend because of government action. So the government, having done that,

:40:07.:40:11.

it comes to the other door and says you're not lending enough, so we

:40:11.:40:17.

will subsidise your loans. What is the point? The problem you have got

:40:17.:40:25.

is that you have the reserve ratios, and there is no doubt that our

:40:25.:40:28.

feeling is that will restrict the amount of money that the banks are

:40:28.:40:32.

able to lend. I think what this does give is a message that the

:40:32.:40:35.

banks need to be looking more closely at how they support small

:40:35.:40:41.

businesses, but also we would very much like the report to be adopted

:40:41.:40:46.

in full tomorrow by the Chancellor and the recommendations that came

:40:46.:40:51.

out on Friday. And this is the problem with government action. It

:40:51.:40:54.

moves one way to inhibit lending, and many things we better do

:40:54.:40:58.

something and rather than easing up on the reserve criteria, it says we

:40:58.:41:03.

will find another way of using taxpayers' money to subsidise it.

:41:03.:41:07.

They're always unintended consequences. The more that the

:41:07.:41:09.

government acts in business there are always an intending --

:41:09.:41:14.

unintended consequences. You have two contradictory things, increase

:41:14.:41:19.

your balance sheet, but lend more. But we cannot go back. All I'm

:41:19.:41:23.

saying is that it is an important signal to educate society to the

:41:23.:41:27.

role of those small and medium terms enterprises. The growth, jobs

:41:27.:41:32.

and wealth in the economy comes from those guys, not big business.

:41:32.:41:35.

What would you like to see in the Budget tomorrow? If you have the

:41:35.:41:38.

Chancellor sitting here and there was one thing to say to him that

:41:38.:41:42.

would make a difference to the SMEs, putting aside income tax or

:41:42.:41:47.

fairness issues, but as a businesswoman, what would you

:41:47.:41:53.

saying? In terms of a high-growth technology enabled start-ups, the

:41:53.:42:01.

ones that will create the future semiconductors, the future internet

:42:01.:42:07.

businesses, make it frictionless. Strip out any kind of tax. It is

:42:07.:42:10.

the largest fixed cost the business have until their prop Tau, which

:42:10.:42:13.

could be five years down the line, but it is such a small amount of

:42:13.:42:17.

money to the Treasury but is the biggest fixed cost. Eliminate that

:42:17.:42:23.

in the first couple of years and let the companies grow into

:42:23.:42:26.

billion-pound giants. At the point that they are able to pay large

:42:27.:42:31.

amounts of National Insurance that is fine, but let's create the

:42:31.:42:37.

Giants first. Wait until they are the big guys. Those sort of

:42:37.:42:40.

companies are the ones that will not get those subsidies. They are

:42:40.:42:44.

not going to take the risk. That is right. A high risk companies you

:42:44.:42:49.

are talking about, they will not get the loans. They won't qualify,

:42:49.:42:55.

and most people don't understand that if you are created a future

:42:55.:43:00.

tax, these companies at the beginning they might only have

:43:00.:43:03.

�10,000 worth of National Insurance, but that is a lot of money at the

:43:03.:43:07.

beginning and almost nothing to the Treasury. We would certainly like

:43:07.:43:10.

some reduction in National Insurance contributions, but we

:43:10.:43:13.

would also like the government to seriously look at putting in a

:43:13.:43:17.

proper structure for the medium term around the idea of a Small

:43:17.:43:21.

Business Administration. OK, we will leave it there. We are going

:43:21.:43:31.
:43:31.:43:34.

to hold you hostage, but we will release you. There are rumblings of

:43:34.:43:37.

independence north of the border, claims that the parliament is too

:43:37.:43:41.

distant and out of touch and a threat to go it alone. But I'm not

:43:41.:43:43.

talking about Scotland, I'm talking about the Shetland and Orkney

:43:43.:43:46.

islands. The two Liberal Democrat members of the Scottish Parliament

:43:46.:43:48.

for the region have submitted a report to the UK government's

:43:49.:43:51.

consultation on Scotland's future suggesting the Northern Isles could

:43:51.:43:53.

be given more powers. And this could mean the oil-rich islands

:43:54.:44:02.

take control of the revenue from North Sea Oil. One of those MSPs,

:44:02.:44:05.

Liam McArthur joins us now from Edinburgh, and Angus MacNeil from

:44:05.:44:15.
:44:15.:44:16.

Let me guess Edinburgh first. What is you have in mind? -- let me go

:44:16.:44:21.

to Edinburgh first. What we set out in the submission to the

:44:21.:44:25.

consultation is, in a sense, a view that whatever Scotland decides

:44:25.:44:28.

whether the referendum takes place that the distinct and different

:44:28.:44:33.

views of the islanders need to be reflected in that. We are realistic

:44:33.:44:37.

and understanding that in terms of votes the views of those in

:44:37.:44:43.

Shetland and Orkney aren't necessarily aren't going to tilt

:44:43.:44:50.

anything one while the other, but then he's to be a focus from all

:44:50.:44:53.

sides including the one the first miniature -- Minister has placed on

:44:53.:44:57.

the future of energy resources. Therefore we need to use that

:44:57.:45:00.

influence to have, as we said in the paper, as much of a bearing on

:45:00.:45:07.

the future power and control that we have in Orkney and Shetland.

:45:07.:45:11.

I just clarify what one of the options is? He's one that it

:45:11.:45:15.

Scotland votes to become independent, but that the Shetland

:45:15.:45:22.

Isles and Orkney actually voted to stay part of the United Kingdom,

:45:22.:45:31.

that these islands should have the Our view this debate needs to

:45:31.:45:35.

happen over the course of not just the duration of the UK Government...

:45:35.:45:39.

Do you think they should have that option? That option needs to be one

:45:39.:45:44.

that is laid open to them. I hope that Scotland votes now in the

:45:44.:45:48.

referendum. Even if it does, I think even if Scotland remains a

:45:48.:45:53.

part of the UK, I think there is an opportunity here for Orkney and

:45:53.:45:57.

Shetland to set out very clearly the extent of new powers they wish

:45:57.:46:00.

to see. Let us not forget when the Scotland Act that brought into

:46:00.:46:04.

being the Scottish Parliament was signed, special consideration was

:46:05.:46:10.

given to the needs of islanders not just Orkney and Shetland but that

:46:10.:46:15.

represented by Angus. Can I ask you too, would you like to see, even if

:46:15.:46:19.

Scotland voted to stay part of the United Kingdom, you would like to

:46:19.:46:22.

see the islands negotiate a new settlement with Edinburgh and

:46:22.:46:26.

London? What I was going on the say Andrew, over the course of

:46:26.:46:31.

devolution, what we have seen is that the safeguards put in to the

:46:31.:46:36.

Scotland Act have been eroded over time they reflected by the

:46:36.:46:39.

Government policies and attitudes, and what we have seen in the last

:46:39.:46:43.

two or three years is more of a centralisation of power, back in to

:46:43.:46:48.

Edinburgh, into Inverness, and that runs contrary to the spirit of the

:46:48.:46:54.

Scotland Act. Let me bring in Angus McNeill. If Scotland votes to go

:46:54.:47:00.

independent, but the island.En. Which I will, but the islands vote

:47:00.:47:09.

not to, they street stay part of the UK should they have that option.

:47:09.:47:16.

1997 we saw Orkney voted for a Scottish Parliament. We are talking

:47:16.:47:19.

about the tug boats have have been moved from tear. They say it is

:47:19.:47:24.

null and void, it is the first they have heard from the MSPs. I am not

:47:24.:47:28.

asking what the convener o the Shetland lands is saying, I am

:47:28.:47:31.

asking you on a point of principle, if the islands voted to stay part

:47:31.:47:36.

of the UK, while the rest of Scotland voted to go independent,

:47:36.:47:39.

would an independent Scotland allow them that right, to stay part of

:47:39.:47:46.

the UK? Scotland is a nation, that includes all part, that are joined

:47:46.:47:51.

in 1472. I would throibg see within Scotland... So you wouldn't.

:47:51.:47:55.

Absolutely... You would not give them, so the OK anys and Shetlands

:47:55.:47:59.

under an independent Scotland would not have the option of going

:47:59.:48:04.

independent, or joining with the rest of UK? From a Hebridean

:48:04.:48:09.

situation, we see the need for uses of service on the mainland. It is...

:48:09.:48:15.

Not talking about the Hebrides. I know you represent them. I I am

:48:15.:48:19.

asking you whether if people from the Shetland and OK anys wish to

:48:19.:48:22.

stay part of the United Kingdom you would allow them to do so. If there

:48:22.:48:27.

is a big enough drive for self determination that would have for

:48:27.:48:30.

considered. Would you allow them to do so. That would have to be

:48:30.:48:35.

considered. People voted for a Scottish Parliament, and if Liam

:48:35.:48:42.

mechanic arthur, the point s we have seen this idea, the leader of

:48:42.:48:47.

OK anyand Shetland... In the OK anyand Shetland stayed part of the

:48:47.:48:52.

UK, how much oil would stay with them? I mean, I think what we are

:48:52.:48:57.

seeing here a fair fraction of oil. A lot of fraction that is an island

:48:57.:49:04.

group that have the highest fuel prices in the UK. If the Orkneys

:49:04.:49:10.

and Shetland decided to stay part of the UK, your whole economic case

:49:10.:49:13.

collapses. Absolutely not. You are wrong, you are absolutely wrong.

:49:13.:49:17.

Really? When you look at countries the size ot Scotland without oil

:49:17.:49:22.

you sigh them thriving. You could have a great future. So Scotland is

:49:22.:49:26.

going to become a tax haven. Scotland can do loads of things.

:49:26.:49:31.

And make watches. Good luck to you. Am I missing something, I am far

:49:31.:49:35.

away from these things, if you live in the Shetland lands you think

:49:35.:49:39.

Edinburgh is far away, never mind London what do you make of what Mr

:49:39.:49:45.

McNeill is saying? I think the outgoing convener of Shetland would

:49:45.:49:48.

have something to say about the suggestion they were to become a

:49:48.:49:54.

sort of Canton. All we have said, is in relation, in... If you could

:49:54.:49:59.

sum up your point, we running out of time. We have started to debate,

:49:59.:50:03.

there is plenty of time, perhaps we would argue too much time for in

:50:03.:50:08.

debate to take place over the next couple of year, the distinct

:50:08.:50:12.

approach of the people in Orkney and Shetland is the way they see

:50:12.:50:15.

their future, it needs to be reflected in this debate. That is

:50:15.:50:19.

what we have kick-started I hope. We need to leave it there. It is

:50:19.:50:22.

time I paid another visit to the Orkney and Shetland lands. It has

:50:22.:50:28.

been a long time. Do you have any idea what they are talking about.

:50:28.:50:33.

It is like family. We all want to kiss our family goodbye, and yet we

:50:33.:50:35.

somehow know we are stronger together, right. We will see. He

:50:36.:50:38.

doesn't think so. I think the Scotland is better with the

:50:38.:50:48.

Shetland lands, the OK anys. you recognise that tie. I have seen

:50:48.:50:54.

other people wear it. That is it for that bit. We will move on. Now,

:50:55.:50:58.

they have another two years of this! The Government's

:50:58.:51:01.

controversial bill to radically reform the NHS in England is within

:51:01.:51:04.

touching distance of being passed into law. It was well over a year

:51:04.:51:08.

ago that the bill was introduced to Parliament and since then there

:51:08.:51:12.

have been nearly 2,000 amendments agree. A pause for more

:51:12.:51:17.

consultation and a lot of bitter feeling between MPs. Was it worth

:51:17.:51:21.

it? We will ask the Health Minister Simon burn what is changes patients

:51:21.:51:28.

can expect to see once the bill is passed. First here is David

:51:28.:51:34.

Thompson. It is never dull being Health Secretary. You go for a

:51:34.:51:37.

quiet walk down Whitehall and before you know it you are the

:51:37.:51:41.

poster boy for radical change in the NHS. If being slagged off by

:51:41.:51:44.

medics and campaign groups was an Olympic sport Andrew Lansley would

:51:44.:51:48.

be going for gold. The Health Secretary insists his plans to

:51:48.:51:51.

reform the NHS in England will lead to greater efficiency, more choice

:51:51.:51:56.

and a bigger say for patients. Critic says it will be the end of

:51:56.:52:00.

the health service as we know it. Will you and I notice any

:52:00.:52:06.

difference? Having ruled out another top down reorganisations of

:52:06.:52:10.

the NHS before the election, David Cameron and Andrew Lansley

:52:10.:52:13.

announced wholesale reform shortly afterwards. The devil's in the

:52:13.:52:17.

detail but very broadly speaking will it work? Immediately patients

:52:17.:52:20.

will notice very little difference in the reforms. Most care will

:52:20.:52:24.

continue to be provided in the same I was it is today, the real issue

:52:25.:52:28.

in our view is not the change, it is the funding of the Health

:52:28.:52:32.

Service over the next four to six years, there will be no more money

:52:32.:52:36.

in the Health Service, other than to allow for inflation. That means

:52:36.:52:40.

there will be big pressure on doctors and hospitals to maintain

:52:40.:52:44.

short waiting times to improve the quality of patient care. It will be

:52:44.:52:48.

a miracle if they can do that and undertake these huge structural

:52:48.:52:52.

changes in the bill at the same time. There is no privatisation,

:52:52.:52:57.

people will not be charged. Then there is the P word. Privatisation,

:52:57.:53:01.

opponents claim this is about injecting the profit motive into

:53:01.:53:05.

patient care. But is it? expectation is the private sector

:53:05.:53:09.

will play a bigger part over the next four or five years but to talk

:53:09.:53:13.

of wholesale privatisation of the NHS is scaremongering, I don't

:53:13.:53:16.

think in five years' time the private sector role will be more

:53:16.:53:20.

than a small minority of the care that is provided to NHS patients.

:53:20.:53:23.

The political pressure got so intense last year the Government

:53:23.:53:28.

announced a pause in the process, that did lead to concessions, a

:53:28.:53:32.

bigger say for patient u Health Secretary to be held response for

:53:32.:53:36.

delivering a service, but most professional bodies remain opposed.

:53:36.:53:41.

So who is right? I believe David Cameron Nick Clegg and lance when

:53:41.:53:44.

they say they want to retain the founding principles of the health

:53:44.:53:49.

vir to make it better. The problem is the reforms are going too far

:53:49.:53:52.

and too fast in our view, the Government would have been better

:53:52.:53:56.

advices to go down the route of evolution not revolution and

:53:56.:54:00.

building on the great success we have seen in the last decade.

:54:00.:54:04.

if you think this is all over bar the shouting, think again. There is

:54:04.:54:09.

much more controversy to come, even when the bill get tons statute book.

:54:09.:54:12.

We are seeing the hard process of making the legislation work in

:54:12.:54:16.

practise, and what that means is the Health Service will be in the

:54:16.:54:20.

headlines right through this Parliament and beyond, will

:54:20.:54:23.

continue to hear stories about patient care, because it is an

:54:23.:54:27.

issue that matters hugely to the public as well as the staff working

:54:27.:54:33.

in the NHS. Simon Burns is with us now. After listening exercise, 48

:54:33.:54:37.

days of debate on the bill and almost 2,000 amendments agreed, are

:54:37.:54:41.

you convinced this is a better bill than you started off with? I think

:54:41.:54:45.

we have improved it through the listening exercise where the

:54:45.:54:48.

independent future forum came one a number of recommendations, and we

:54:49.:54:52.

accepted all the core once, and through the discussions we have had

:54:52.:54:56.

with people interested in the health economy, with Liberal

:54:56.:54:59.

Democrat cross bench and Conservative and even Labour peers,

:54:59.:55:03.

they have come up with ideas which have, to my mind, improved and

:55:03.:55:07.

strengthened the legislation. then lends itself to saying the

:55:07.:55:11.

bill wasn't right, it wouldn't have worked and if you had gone down the

:55:11.:55:15.

road as was said of evolution, it might not have been such a painful

:55:15.:55:20.

process. I think with all legislation, it studied as you know

:55:20.:55:24.

in committee in the commons and the Lords, and that is the area where

:55:24.:55:28.

one works, to improve legislation. Yes, but this was different. Isn't

:55:28.:55:33.

it because it is the NHS, that the Government has been talking about

:55:33.:55:37.

here, the sacrosanct in so many people's minds there has been so

:55:37.:55:40.

much division and debate and argument over it, and that perhaps

:55:40.:55:46.

you didn't quite foresee that when you started out? What I didn't

:55:46.:55:49.

foresee was certain individuals and groups trying to politicise the

:55:49.:55:53.

issue and turn it into a political football, and even on the

:55:53.:56:00.

amendments you are talking about and there are a large number, 7 a 6

:56:01.:56:06.

were changing the name. What will patients see what will be

:56:06.:56:11.

different? What will be different is there will tht be the day-to-day

:56:11.:56:16.

political micro management from Whitehall, of the NHS, what we will

:56:16.:56:21.

see is doctors taking control of commissioning care for their

:56:21.:56:26.

patients, we will see cutting back on bureaucracy, partly through the

:56:26.:56:30.

bill but also through the quip programme, so that the money that

:56:30.:56:35.

is saved can be reinvested in the NHS. Will patient, when they go

:56:35.:56:40.

most people go to the GP, will they see anything different. Nothing

:56:40.:56:44.

will really change for them will it? It will. We are increasing the

:56:44.:56:47.

choice patient also have. At the moment they have had the choice of

:56:47.:56:50.

which provider they can use. There will be the choice of which

:56:50.:56:53.

consultant they can use, in time the choice possibly of making it

:56:54.:56:57.

easier for choice of GP. They will be empowered with more information

:56:57.:57:01.

about what is going on in their local hospitals, in the local NHS,

:57:01.:57:05.

so they can see how they can exercise that choice, if they wish

:57:05.:57:11.

to do so. Politically though, you worried now, as some people have

:57:11.:57:14.

predicted that anything that goes wrong in the NHS, anything from

:57:14.:57:19.

sort of GP to hospital level, will all come back to what you have done

:57:19.:57:23.

to the NHS via this bill, that politically it will damage you?

:57:23.:57:28.

have no doubt that some politicians, and others, will seek to try and do

:57:28.:57:33.

that, to score political points, but the fact is, I believe that

:57:33.:57:38.

what the Will -- bill is doing in liberates the NHS, giving greater

:57:38.:57:42.

freedoms to clinicians and concentrating on improving outcomes

:57:42.:57:46.

and commissioning of patient also see the NHS strengthen and improve,

:57:46.:57:52.

and we are already seeing over the last year or so, that the

:57:52.:57:55.

performance indicators are stable and doing rather well. Do you agree

:57:55.:57:59.

Julie that, people who have said that the whole idea of

:57:59.:58:02.

privatisation and too much competition will be damaging has

:58:02.:58:06.

been scaremongering and is overblown? Yes, two points to build

:58:06.:58:10.

on something that Simon said, not only is choice a good thing, we

:58:10.:58:13.

should reject the concept that anything can come like ten

:58:13.:58:16.

commandments from on high and never be changed and they are set in

:58:16.:58:21.

stone. There has to be a process, first of all, doctors who are

:58:21.:58:23.

extremely educated people are probably the best people to know

:58:23.:58:28.

how to deliver great care, right, and so if doctors want, maybe local

:58:28.:58:31.

GPs will implement things you asked about how does this affect the

:58:31.:58:36.

patient, maybe he will target certain ways of delivering care

:58:36.:58:39.

through iPads, I don't know what, the doctor knows how to do that.

:58:39.:58:43.

Thank you very much. Thank you both of you. That is it for today but

:58:43.:58:48.

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